Suffering Ado About Oil

Earlier today the containment cap was off the riser. Oil and gas was spewing into the gulf for a good 8 hours. One of the vents was damaged and the cap had to be removed. There were also two deaths in the oil spill recovery team. It is now back on and they are collecting and burning about 27,000 barrels of oil per day. Spill estimates currently range between 35,000 and 60,000 barrels per day.

Gas entered one of the lines which actually cools the containment cap. A robot arm from one of the ROVs accidentally bumped a vent, at which point gas went up the line. That line is used to heat the containment gap so the gas doesn't form hydrates (freeze).

Even more despairing, a boat captain working on the clean up, shot himself. From MSNBC:

The deaths reported Wednesday were not tied to the containment operation. The Coast Guard said the workers had been involved in cleanup operations did that their deaths did not appear to be work related.

One death was a boat captain who died of a gunshot wound, a Coast Guard spokesman said. Further details were not immediately available.

Dudley, who had led BP's operations in the Americas and Asia, is no stranger to tough situations, having protected his company's interests in rough dealing in Russia even after he was barred from the country.

The 54-year-old spent two decades climbing the ranks at Amoco Corp., which merged with BP, and lost out to Hayward on the CEO's slot three years ago.

Looks like more politics, for Dudley reports to Hayward, who has a vested interest in making sure Dudley doesn't get his job.

The last technical update was on June 18th. As one can see, the plan to use dispersants has not changed.

While the structure in claims processing has changed, it appears that deployment of technologies to clean up the spill are still wrapped up in bureaucratic red tape.

Even worse, scientists are suspecting the oxygen levels, due to bacteria eating the oil, are reaching critical lows. This kills sea life and is known as a dead zone.

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Unfortunately the technical info is more and more lacking, but looking at spillcam you can see the cap now. I don't know if that is the ROV camera angle or what, but let's hope it means a larger percentage of capture.

On the other side of things, it's just a horror show. Literally they stopped the sand barriers claiming Louisiana did not have the right "building permits". Building permits. We have an ecological Armageddon in the gulf and so asshat stops them due to "building permits".

This is the great crime on top of the oxygen levels potentially dropping. That will kill, God knows how much sea life.

Of course they are also running out of boom and other supplies, yet supposedly there is tons of it literally in warehouses.

It's unclear if they accepted foreign help, last I read it was still blocked.

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The oil drum has a good update summary for Jun 25th. They are noticing what I am, that when they replaced the cap, a lot less oil is escaping. They are making good process on capturing most of the oil at the source now but the real final one is putting the permanent cap on, which happens next week.

The problem with stating there is much less oil escaping from the cap is the cameras. They are not at the top of the cap, but there are additional riser pipes now around the cap, sucking up the oil in a reverse top kill process.

Regardless, no way to fake out the less amount of oil gushing, previously it was from every camera angle. (unless someone is doctoring the video feeds after the fact and then they wouldn't be live...wouldn't put it past BP!)

So of course, during the interim, we have a tropical storm, looking to become a hurricane, entering the gulf of Mexico.

If gale force winds hit that area, they must shut it all down. The current trajectory implies it's going to miss the spill site, but hurricanes can be hundreds of miles wide and gale force winds are on the out stretches of a hurricane.

I sure as hell hope they can get that permanent cap in place and capture all of the spill.

That's a huge first step, although reports are pouring in on how BP is short changing the clean up, not buying technologies that will do the job, not hiring people willing to do the work and supplies are running low. Still, supposedly refusal to let other nations, clearly U.S. allies, help too.

That's a friggin' crime but at least on the containment side we're seeing some progress.

The relief wells are very close but that's also a crap shoot. They are using magnetic fields to locate the well but realize many experts have said the well itself is damaged, so .....

Also, the drilling ban, it's only 33 wells, that are thousands of production wells. Drilling or exploration, isn't the same thing as production.

Just a side comment but it looks like "dot city" the amount of production wells in the gulf....so why is it ok to drill there, in such a sensitive environmental area, where the U.S. seafood comes from and so on...yet not ok to drill in the frozen arctic tundra? Notice that? ANWR is off limits yet we never really heard about the gulf, with all of these critical ecosystems?

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There is some horrific accounting by Bureau of Int'l Settlments and the Fed, most likely, New York. If you go over the accounts on the first link on the BEA tab, you can derive a balance sheet from their text descriptions over a 2 year period. I can understand why they do not publish an official balance sheet - huge transactions are off the books. I mean Trillions of dollars in 2008 and 2009. You can bet this is a good part of the 'audit the fed' story.

US International Position

Assets $Billions

2009

2008

Derivatives with Positive Fair Value

3512

6127

Reserves

440

330

SDRs

82

541

Direct Equity-Foreigner-Banks

4051

3759

Claims on Foreigners-Bank

4064

3676

Claims on Foreigners-NonBank

794

793

Direct US Owned Assets

18379

19245

US Held Foreign Securities

5471

3986

Total Assets

36793

38457

Liabilities

Foreign Held Assets of US

21117

22739

US Negative Value Derivatives

3384

5967

Foreign Official Assets

4373

3939

Foreign Held US Equities

5287

4621

Stock of Foreign Invest – Cost

2672

2521

US Currency – Foreign Held

314

301

Liabilities to Foreign Residents

3593

3382

Liabilities to Private Foreign Residents

66

665

Total Liabilities

40806

44135

Derivatives, Loans

-4013

-5678

The Last Line is a plug because of what is not shown on the asset side.

There are undisclosed assets. The liability side is greater. This means international loans are made and not disclosed.

Or other assets are just not on the balance sheet. The activity in derivatives is presented straight from the text and worked back from what BEA gives for 2008. Just look at the change in derivative valuation and you get how the bailouts

happened...

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